Chapter 4 part 1 - Chapter 4 part 1 (questions 10,...

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Chapter 4 part 1 (questions 10, 11,14,15,16,17,18,BE4-2, BE4-3, BE4-4) Questions 10) a) Both revenues and gains include inflows of assets and involve transactions but the main difference is that with gains there is a net of assets so there is an increase in the equity that we can calculate b) Expenses are the outflows of assets or using up of assets where as losses are the decrease in equity or the net assets that will be negative 11) The advantages of the single-step income statement are that they only show total revenues and expenses which enable the calculation of the net income. That way the company can really focus on what are the gains and losses. The disadvantages of the single- step income statement are the company can’t see other factors playing a role such as taxes or operating expenses. 14) The company should restate the prior statements for the effects of the error 15) a) The transaction will be recorded the $ 113,000 as an extraordinary item and will be shown in a separate section. b)
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This note was uploaded on 04/14/2011 for the course ACCT 3202 taught by Professor Kenmichael during the Spring '11 term at University of Minnesota Duluth.

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Chapter 4 part 1 - Chapter 4 part 1 (questions 10,...

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